4 Top Stocks for Traders: PGI, IMCL, GSX, CHTT
Savvy traders rush in where average traders fear to tread.
“Rush” may not be most accurate term. But anyone who has been paying attention to what works for short-term trading knows the truth in that statement. It is a cliché to say that traders should be “buying” when the rest of the world is “crying.” Nevertheless, for traders who focus on buying weakness and selling strength, this is no mean cliché–it is virtually a commandment.
If you ever wondered why trading was so hard, or why more people do not trade stocks, then this is probably a large part of it. Nobody feels bad about paying a lot of money for something that is going up in price. As we are learning more and more everyday, such easy decisions were significantly responsible for helping driving the mortgage finance bubble bigger and broader over the past few years.
What is actually harder is to buy an asset that is going down in price. Falling prices, in popular thinking, only beget still lower prices. This is one reason why so many are panicking about the falling housing market. Would-be buyers, convinced that falling prices will lead to more falling prices, feel completely comfortable sitting on the sidelines, waiting for prices to move lower and lower and lower.
One trick about buying anything that is moving lower in price is to determine when an asset is actually worthy, but on sale, as opposed to when an asset is overvalued and rightly correcting in price. When it comes to stocks, we use a very simple rule that helps us decide whether or not a stock is “good merchandise” on sale or “cheap merchandise” deservedly discounted.
That rule is the 200-day moving average. When we see stocks trading above the 200-day moving average, we consider them to be strong stocks all else considered. When we see stocks trading below the 200-day moving average, we see them as weak stocks, stocks to be avoided or sold short.
Click here to read our research into trading stocks above and below the 200-day moving average.
All of the stocks in today’s discussion have PowerRatings of 8. Actually, Imclone Systems
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Premiere Global Services
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Imclone Systems
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Gasco Energy
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Chattem
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Whether or not the bottom is in–do you have the tools and strategies you will need to successfully trade stocks in the short-term? Try our free, 7-day trial to TradingMarkets’ Short Term PowerRatings and get access not only to our proprietary PowerRatings data and tools, but also to a wealth of market commentary and analysis, educational HOW TO articles and interviews with some of the most talented and successful traders around. Click here now to request your 7-day free trial to TradingMarkets’ Short Term PowerRatings–or call us today at 888-484-8220.
David Penn is Senior Editor at PowerRatings.net.